Seth: Hey all, this is Seth Williams. You're listening to the REtipster podcast. This is episode 208. Show notes for today can be found at retipster.com/208. Today I get to sit down for my second great conversation with Logan Fullmer.

We interviewed Logan on the podcast about a year ago, and it was such a fascinating conversation and a breath of fresh air for a lot of people in the REtipster audience. Logan explained his strategy of intentionally seeking out properties with all kinds of problems, whether they're landlocked or have nasty title issues—the kinds of things that would make most normal investors run in the other direction. He goes after that stuff on purpose and figures out how to deal with them. As a result, he makes properties marketable and useful again, legitimately bringing a ton of value to the markets he works in. And as a result, he makes a ton of money on these deals, rightfully so.

If you haven't heard that first conversation yet, I strongly recommend you check it out. You can find that one at retipster.com/177.

Ever since we did that interview, I've heard Logan's name come up in conversation again and again because his strategy is pretty brilliant. It's a whole new take on this business, and it's something that most people just haven't thought that much about.

So today we're going to dive into this even more. We'll get a refresher on some of the basics of what Logan does, we'll dive into some of the finer details that we didn't get to in the conversation from this past year, and it's going to be awesome. So Logan, welcome. How's it going?

Logan: Excellent, Seth. I appreciate the invite.

Seth: For those who are not going to do what I just said and go back and listen to episode 177, can you give us just a quick recap on what your strategy is and how is it different from what most real estate investors do?

Logan: My strategy is doing the deals that other people usually walk away from. An example would be: walk over to your office trash can and go pick a piece of trash up out of that. That would be my deal. Everyone's doing the deals that are on top of the desk; I'm dealing with the deals that people discard.

Those deals have multiple owners that can or can't get along, judgments and liens that can outvalue the property, unresolved estates, which I call orphaned estates, missing or lost owners, and breaks in the title chain. You guys know what that looks like. That's the deal that you couldn't get closed and you're busy wholesaling or flipping and you're like, "Forget it, I don't have time for that." Those are the deals I got time for.

Seth: I actually made a little chart for myself after I was re-listening to our conversation from last year, just kind of making a punch list of all the different types of issues that you deal with, whether it's landlocked or somebody died, or there's breaks in the chain of title—all kinds of different situations. But I'm wondering, of all those different situations, if somebody is a beginner and they're trying to do what you do but they're just kind of overwhelmed, they don't even know where to start or what types of problems to go after. What do you think is like the best one for a beginner to cut their teeth on? And how do they go about finding that type of deal?

Logan: Multiple owners, less than 10 owners, delinquent on taxes. The reason I like that is 50 or more percent of the messy title deals really are just multiple owners. The other 50% or a little less than that have a lot of complexities around them and can be much more work to resolve and much more time. But at the end of the day, the most common factor across them is just multiple owners that aren't getting along.

Think about this for a minute. You and your business partner are going to sell a flip house. They'll do the title coming together. They'll both sign it. No big deal. Well, if you two aren't getting along and you want to sell, but he doesn't, and he's manipulative to you and he's holding you up—that's kind of the foundation of what you're dealing with. Family members that either don't get along with each other or are mean to each other intentionally or sometimes unintentionally. They live in different places. They can't coordinate. Frankly, they have a busy life and they don't really care that much, so they don't engage.

Figuring out how to deal with each one of those people in a silo, not contingent on the others, is 50% of the skill. And the neat thing is you want to look for problems that are big enough to ask for the discount but not so big that it takes you 10 years to fix. So that really is multiple owners that just don't get along.

Seth: Remembering right from last year, I think you said you're not going to move on a deal unless you can make 30 grand or more. Is that what you said?

Logan: Yeah, I like to see 50 as a minimum. I just ran a report actually the other day. Across our 120 properties in inventory right now that we own—that's not our annual transaction count, that's current inventory—I ran a report that looked at the cost basis of every one of them, our fair market value for our comparable value, our target for our price to sell, or the ones we've already sold. That gives me a firm actual number.

I looked at those data points and then also looked at when did the property come into inventory and when did it leave inventory. So that was trailing data, and then also what our forecast was for the current stuff. Right now, on average of the 120 transactions, roughly, the average sales price is $194,000. Average purchase price is $48,000. And average time in inventory is about 120 to 150 days. So currently we're trending at greater than $100,000 net per deal.

Seth: When you say time in inventory, does that mean you've already taken care of the title problems; you bought it, and now you're just waiting to sell it? Or you buy it and then you take care of the title problems?

Logan: What I'm registering is the moment I spend the first dollar on the property until I get paid. Some of those properties, I own 100% and they're listed on the market and we're waiting for a buyer. Some of them we close next week on the sale. Some of them I own 10% and I haven't purchased the other 90%—I'm still negotiating or whatever. But if we've spent $1 on it, that's what qualifies it for being in inventory and starting the time clock.

Seth: Under what circumstances would you buy a property before all the title problems are cleaned up? Or does that just not happen? You clean it up and then you buy it?

Logan: No, usually what's happening is we're surveying what we believe is the problem and we're starting to make offers based on that. It's rare that we can solve all the problems before we buy. With us, we've gotten to the point where, because we abstract, underwrite and examine in-house, we don't use title companies when we buy. I'm buying 90% of this without title insurance. I'm purchasing and we're fixing title problems as we buy, after we buy.

The trigger for us to go put it on MLS is that we've underwritten it, we've cleared all the title problems, we've purchased all the interest and now it's time to go get it out there on the market and sell it. So we do that in house.

I think about folks that might be earlier in their real estate career and don't have specific experience in this. And that sounds scary. And you might automatically say, "Oh, he buys without title insurance and he underwrites himself. I can't do that." I shouldn't think about this, but that isn't true. That's not the right line of thinking. Folks should be interested and ask yourself, how can I do this?

Those folks should do this with title insurance. So get contracts from sellers, send them into the title companies and continue contracting more shares. Keep sending that in and let the title companies and a lawyer that you pay help you figure out how to solve those problems. So I would recommend most people close with insurance as they're learning because you can. You just need to get a longer contract. Don't contract for 30 days; contract for six months. You need time.

Seth: Going back to this thing you talked about, looking for properties with multiple owners with delinquent taxes, how do you seek out those specific properties? Are you starting by getting the delinquent tax list and then you're just hoping that some of those have multiple owners? Or is there a way to intentionally target only properties with multiple owners and how would you do that?

Logan: We've been through every rendition of searching the docket for leads, searching the property records for leads, referrals. I mean, we've done it every kind of way you could ever imagine in the last 10 years. What I've found is actually the most effective is a delinquent tax list because a delinquent tax list in itself is a great lead source. It's very affordable.

You need to spend a little money cleaning it up because a lot of those owners are deceased or they're multiple owners, they don't all show up on that list. But if you start with a delinquent tax list, a large part of those properties will have title problems. They're going to be old ownership. And if it's delinquent on taxes, you know it generally does not have a mortgage. Otherwise, the mortgage servicer would pay the taxes.

So you now inherently know there's much more equity. I start going after deals that have far more equity than most because they don't have mortgages. But over time, we've learned that those properties have title problems many times. So that's a great place to start—delinquent on taxes, lots of equity, probably got some problems. And sometimes you get lucky and they don't have title problems. You can buy a good deal, and if that's the case, we're willing to pay more because it's clean and a quick turn. But our rule of thumb is we want to be in it for 20 to 50 cents on the dollar, never more than that.

Seth: Yeah, the delinquent tax list is an amazing thing. It was basically how I first found success in real estate, thanks to that list. But I don't know how it is in your markets, Logan, but they were a huge pain to get for me. And when I did get it, it was a total mess to clean the thing up. Totally worth the effort, but you gotta be ready to deal with some of that stuff. If anybody wants to know how to do that, I've written this massive blog post explaining everything you need to know about how to get that wherever you're at. I'll link to that in the show notes, retipster.com/208. Big markets usually are easy, but there are a lot of markets that are, like you said, really hard.

I am wondering on that—you mentioned you pay 20 to 50 cents on the dollar—kind of reverse engineering that. How do you put a value on the amount of work that you're going to have to do to make that deal marketable again? I don't know how you quantify your time or just how hard you think it's going to be, but that's got to be part of the equation, right? That's sort of what determines how low your offer ends up being because nobody else is going to do it, right? Logan: You're right about that. We start out saying, “Alright, let's just use easy numbers, $100,000 property.” And let's say there's 10 grand owed in taxes. Our initial offer—and again, for easy math, let's say there's five owners, so each one has $20,000 worth of equity—our initial offer isn't "we're going to give you $20,000 for the property."

I'm talking to one fifth owner and I'm basically telling them, "Look, I want you to detach the value of the money I'm giving you from the real estate because you have title problems, you have delinquent taxes, you have multiple owners. You guys are in a tough spot. We all know that. I'm paying you for your time to sell me this interest in the property. I'm just buying your seat at the table. I'm buying your seat at the Thanksgiving table of a dysfunctional family."

So I'm willing to give you a thousand dollars to sign over your share. And then I'm going to take your seat and go try to fix this. But I don't want you to think the money I'm giving you is directly correlated to the value of the property, because it's not, because we all know the properties are worth multiples of what I'm going to pay you.

I'm very transparent about that, but I want you to know I'm the lowest price person that's going to buy this property ever, but I will buy it for sure. And I will fix all the problems and I'll send you a cashier's check and a deed tomorrow. But if you want max money, you should go fix the problems and you should sell it. And during our conversation today, I'm going to explain to you all the work I've got to do. But if you ever at any point decide you want to do it instead of me, I'm happy to tell you how you go do it. The goal is to be able to detach the value of the real estate from the money that I'm paying them and let them know that this is a project. And the way I make money is really a return on my time and knowledge, not an investment in a real estate project. I've got to aggregate multiple owners who don't get along. I got to go pay and release a tax lien. And by the way, your cousin never paid his child support and he has a $40,000 Attorney General baby mama child support lien. I have to deal with that. So really, the way I earn my money is solving these problems, not flipping your property.

Seth: Makes sense to me. I am wondering; we've talked about kind of like the quickest wins or the fastest way to find maybe the easiest opportunities. But I'm curious, in your experience, which curative title problems or issues are the most profitable to clean up? And how much more risky are those because of how profitable it is compared to just a normal deal? Is it worth the risk to try to go after a more profitable one, whatever that looks like?

Logan: I don't know that I would say certain title problems are more profitable than others. It really depends on the value of the property they're attached to. Let me tell you another concept. When I started doing this in my market, I was buying property, vacant lots or crummy houses downtown that were worth 50 to a hundred grand. And I'm buying them for five or 10,000, fixing these problems and reselling them. So I'd make 50 to 70 grand on those.

And I stumbled across a property in Austin that had the exact same title problems. The difference is that crappy house on an infill lot was worth $500,000 So you can look at higher value and get more money that way. Now, sometimes you'll find like open lawsuits that people quit litigating that are just hanging out there that you have to go in and try to get those settled. Or like you'll have a lost owner that no one's heard from for 20 years. You have to find that human. Those are some of the things that can be more work than just "there are four people that don't get along and I have to just deal with them separately." Those are fairly simple.

But really, the way you make more money in this isn't looking for more complicated problems. It's looking for higher value. I prefer to find the medium problems on higher value property.

We've got a judgment or two to release. We have multiple owners, but they all seem like they want to do the deal. They just don't know how. And when you start to look at, okay, I can solve this. I kind of get it. I think I can solve this. And there's just a judgment that's nine years old and it becomes no good in 10 years. I might just have to wait that one out seven more months, or I might go negotiate with the lien holder. And it's so old, I can buy it for five cents on the dollar.

So you start to look at all these problems and say, I believe I can solve these. I think there's a path to resolve. But when you start out some of these projects and you can't see a path to resolve on some of them, then you say, oh, this is going to be more complicated.

Seth: That's a good segue to my next question here. So what makes you say no to a deal that is super profitable? Like what problems are so big, they would scare you away? Is the juice worth the squeeze? Is it just a matter of profitability, or how hard the work is going to be?

Logan: Yeah, I had somebody call the other day and tell me all these problems and they weren't really that hard, but the properties only were 50 grand. I'm like, "Dude, I'm going to do all this work to make 30 grand? Not happening, man, go find another one." So that is one that matters.

Another one is if you have a minor that owns a large share of the property. It's a flip of a coin if you're going to be able to buy that minor share for less than it's worth because you're going to have to go into the courthouse in front of a judge and do a guardianship of the real estate of a minor or something like that. And many times the judge will ask for an appraisal and you got to pay full price for that. So I won't touch it unless the minor has a small share or I pick up so much equity on the other shares that I can afford to pay the minor full pop. That's a big one that stands out.

Missing owners can be trouble sometimes. You've got to be able to find that person. And if you can't find them, you can't complete your deal. So sometimes we'll contract with folks and then really put some real good PI dollars into investigative work to find the person. But if you can't find them, they're dead, or they died in a different country, you're going to have to do a lawsuit, like a partition lawsuit or something. And that's going to add a year to your timeline—another 20 or 30 grand. And I thought, let me take a run at this. It was the same amount of work, the same amount of negotiation, and the same amount of owners. The difference is that when I got done and sold it, I sold it for $500,000 instead of $100,000.

So you can look at higher value and get more money that way. Now, sometimes you'll find like open lawsuits that people quit litigating that are just hanging out there that you have to go in and try to get those settled. Or like you'll have a lost owner that no one's heard from for 20 years. You have to find that human. Those are some of the things that can be more work than just "there are four people that don't get along and I have to just deal with them separately." Those are fairly simple.

But really, the way you make more money in this isn't looking for more complicated problems. It's looking for higher value. I prefer to find the medium problems on higher-value property. We've got a judgment or two to release. We have multiple owners, but they all seem like they want to do the deal. They just don't know how. And when you start to look at, okay, I can solve this. I kind of get it. I think I can solve this. And there's just a judgment that's nine years old and it becomes no good in 10 years. I might just have to wait that one out seven more months, or I might go negotiate with the lien holder. And it's so old, I can buy it for five cents on the dollar.

So you start to look at all these problems and say, I believe I can solve these. I think there's a path to resolve. But when you start out some of these projects and you can't see a path to resolve on some of them, then you say, oh, this is going to be more complicated.

Seth: That's a good segue to my next question here. So what makes you say no to a deal that is super profitable? Like what problems are so big, they would scare you away? Is the juice worth the squeeze? Is it just a matter of profitability, or how hard the work is going to be?

Seth: Yeah. I had somebody call the other day and tell me all these problems, and they weren't really that hard, but the properties were only worth 50 grand. I'm like, "Dude, I'm going to do all this work to make 30 grand? Not happening, man. Go find another one."

Logan: That's one thing that matters. Another one is if you have a minor that owns a large share of the property. It's a flip of a coin if you're going to be able to buy that minor share for less than it's worth because you're going to have to go into the courthouse in front of a judge and do a guardianship of the real estate of a minor or something like that. Many times the judge will ask for an appraisal and you've got to pay full price for that. So I won't touch it unless the minor has a small share, or I pick up so much equity on the other shares that I can afford to pay the minor full price. That's a big one that stands out. Missing owners can be trouble sometimes.

You've got to be able to find that person. And if you can't find them, you can't complete your deal. Sometimes we'll contract with folks and then put some real good PI dollars into investigative work to find the person. But if you can't find them, or they're dead, or they died in a different country, you're going to have to do a lawsuit, like a partition lawsuit or something. And that's going to add a year to your timeline—another 20 or 30 grand. So you have to look at your project and make sure that first you can afford to carry all the costs for that year. If you spend 20 or 30,000 on that lawsuit and it takes a year, are you still very profitable?

Logically speaking, if you've never done one before, I tell people to just estimate a budget for every problem. You go through and estimate these budgets and ask your attorney and ask the title company, "Hey, this judgment's for 50 grand and it's nine years old. Do you think I can settle?" The title company might say, "I've seen these released for half price or 30 cents on the dollar." There's your budget. Go in and kind of tack numbers in. And then once you build out that budget, you then offer the folks that much less, the sellers. And if you get lucky and don't have to spend all those budgets and you come in under budget on all of them, that increases your margin.

Seth: Well, just to talk about a ridiculous scenario here, because I like to do this to really figure out what certain things mean. So if there was a property where you were pretty sure you could make $50 million on it, but it would take 10 years and $5 million to make it happen—do you say yes to that or no because it's too much time?

Logan: A hundred percent, it's big money. I've got a couple of deals like that. Something's got to be good about the deal. You either have to pay very small dollars to enter it, or the value is very high, or you're looking for some advantage to get there and then make your business decision.

Let me give you an example. There's a man; he and his wife had about $7 million worth of real estate together. She wanted to divorce him and he didn't want to divorce her, so she left. She called him five years later and said, "I'm going to remarry. I want to be on my new husband's health insurance. Will you please finalize this divorce?" He said no.

Well, we ended up getting ahold of her several years later and said, "Hey, you own a 50% community property interest in $7 million worth of real estate." She's like, "Yeah, he won't do anything with me." I said, "You're an owner." She said, "I could care less." So my next response was, "Would you like me to sue him?" She's like, "Oh, I'd love that. I hate him." I said, "Okay, will you sell me your share for $10,000?" And she said, "No, but I'll sell it to you for 20."

So I purchased $3.5 million worth of real estate for $20,000 from her. And now I'm suing the guy for a partition. So my upside is $3.5 million, $20,000 spend. I'll spend another 50 grand on legal fees. And the judge will post all this stuff for sale and sell it. And I get half the proceeds. Now it's a two and a half, three-year deal.

Seth: It almost sounds like there's some kind of math equation there—like the upside, downside, and time. I don't know if you've thought it through that carefully. Maybe it's all just case by case, but do you have any ratio in mind? Like you need to make at least this much for the dollars and time you put into it?

Logan: I haven't sat down to write it into an equation or like a step-by-step, but a lot of this is a function of your budget and your bandwidth. So I've got 20 people in my office and we have a lot of horsepower these days—multiple attorneys, lots of capital. But in the early days, I could only afford $5,000 or $10,000 per deal because I knew I had to be able to carry it for a long time and had to have money for legal fees. And as you can imagine, you can't use debt on these deals because you can't get title insurance.

So it was a function of how much money I had and how much money I could afford to let sit there until I solved it. Well, today, more resources, more budget, more experience. So today I've got deals where I've got $200,000, $300,000 in that are four-year, three-year deals. I'll just sit on it. But they make huge multiples, multimillion dollars on those deals. So is it a fast deal? I'll pay more. Is it a slow deal? I'll pay less. How big is the return? How complicated is it going to take me to get there? I got one deal with $150,000 in legal fees. I've been pounding that thing all year long—just $15,000, $20,000 a month in legal fees. It's a rough one. I'll make several million dollars when it's resolved.

Seth: What is the risk that you would spend that money and you can't get to the bottom of it and you just lost the money? Does that ever happen?

Logan: I've lost money on a couple of them. But the interesting part is that what I'm buying has different risks. I still am buying equity in real estate. So I might be buying $100,000 worth of equity for $10,000. The question is not, “Can I solve all of the title problems?” It's, “Can I get to my equity?”

So there are two exits that usually will fix any of these matters. One of them is the tax foreclosure, the sheriff sale. So when I'm aggregating these interests, I always keep in mind if I can't solve a title problem, it's not worth me solving, or it's just going to be too expensive and take too long, all I have to do is just not pay the property taxes and the sheriff will go sell that property for the tax foreclosure and I can go collect the excess proceeds and that's how I can monetize.

Now that can take a few years, but I've got several deals where I bought like a 75% share in a radically messy estate. I paid five grand and the property's worth four or 500,000. $5,000 is my entry. I got all the deeds that an affidavit of heirship with the family recorded. And I got like 75% for five grand. And I didn't pay the taxes. There's a delinquent tax bill on it. And I just let them go. The sheriff is now noticing me doing the sale. I've been in it for over a year and a half, two years. I just got noticed that I'm being foreclosed on for taxes unpaid and the sale is going to take place in December of 2024. So the sheriff will sell this property and I'll go claim excess proceeds and I don't have to fix the title problems. That's the way to prevent yourself from failing. It's the backstop.

And then the other one is the partition lawsuit. I might not be able to cut deals with these other people and be reasonable. And frankly, I don't have the bandwidth. I'd rather file a partition lawsuit and let the judge order it to be sold. And I'll just get paid out of that sale.

Seth: And I know you're talking about collecting the excess proceeds from the tax sale. So I believe that is a state-specific thing in Texas where you do all your deals does allow you to do that. A number of states do not, or at least they did not. I thought I heard of some development like in 2023 or something where this somehow changed. I'm not going to quote anything because I don't remember what that is, but I guess that's just one thing to be aware of if you want to enact that thing Logan's talking about. Just make sure your state actually allows you to do that. But that is an awesome failsafe at the end of the day.

Logan: The delinquency and the tax collection process are radically different in every state. In our state we have tax deeds. The moment you buy the property at the tax foreclosure, you're vested. It's yours. But the person who lost it has a right to redeem it within certain timeframes for certain premiums. Some states are tax lien states where there's a statutory tax lien and they'll sell it off. And then the only way the person becomes a title holder is if they do a quiet title suit after certain timeframes and with criteria. So there's a strategy for all these different options, but it looks different per state.

Seth: Is there any competition in this business that you're running? It seems like there's probably almost none, right? Do you know of other people doing exactly what you're doing?

Logan: I have a list of them, actually. They're in a coaching program that I run. All four of them. You know, so I have four business partners in my office that I've literally trained side by side, elbow to elbow, how to do this over the years. So I effectively have four business lines or five, the fifth one that runs here in this office. And we do these transactions consistently.

There are people that will take a stab at it. Every once in a while, you hear about somebody fixing one, but I don't know anybody in the United States that systematically and organizationally takes on this stuff intentionally. In the coaching program I run, we coach usually between 25 and 30 people per session. And I'll do it once a year. I think this next year I'm gonna do it twice. But we teach people how to do this and we've learned how to get people educated in four months to be profitable in that four-month period because we've done it for 10 years and we know what to teach you and what matters quickly. We can't teach everything, but we can teach you to get to profitability on the right deals. And then after that, we kick them out in the world and go learn the rest of it on their own. But now we've taught you how to make money and do this.

Folks were asking me, "Why would you teach us how to do this?" I said, "Dude, I got 6,000 leads in my CRM and I own 120 properties. I can't scratch the surface. It's incredible."

Seth: I really love how you're solving big problems that everyone else is scared of. It's almost like you're creating real estate that is unusable or nobody's going to touch because of these problems. There must be something very fulfilling about that, being like, almost like buying a beater car and making it look shiny and new and making tons of money from it. It's like you actually did some good for the world, which is really cool.

Logan: It's neat. We take property that is not in service. It's not being used. There's no tax being paid. It's a train wreck. And we bring it back to service.

Seth: Thinking through somebody, maybe a beginner, maybe somebody's in their twenties, maybe they've got 10 grand cash. How much money do you think a person needs to have before they can start doing this business? Do they need 50 grand, 10 grand, 100 grand, nothing? What could they do to make that work?

Logan: It's less than you think. So I just closed out a round of coaching actually, and I did an exit interview and I wanted to know what was the peak capital that the students invested while they were in the program. How much money did they earn and how many transactions was that across? And the lowest investment I saw was $15,000 and Seth bought $400,000 worth of profit. So he was offering people $500 or $1,000 over their payoff, and they were taking it. He picked up $400,000 in equity. He hadn't sold all of that yet by the time the program was over with, but over the next month or two, he will.

Now, that's on the low end of that spectrum. On the other end of the spectrum, I had a guy spend $100,000 and pick up $500,000 in equity. And then another guy, Chris Berry, picked up $1.4 million worth of property, and he only spent $200,000. He had sold half that during our program and the balance he was getting listed and getting ready. That guy made, if he didn't do any more deals in five months, he'd have done $1.5 million worth of profit, 1.4. And that was across like eight or nine deals.

Think about this for a minute. Most people are borrowing 200 grand to flip a house to make 30 or 40,000 in profit. Here you need to come up with 200 grand to make a million bucks. This is a return on your time and your knowledge. This is not a return on capital. Capital is not the hard part of this equation.

One of the entities in my office, the most aggressive one, ran this report last week. It owns 62 properties. Its total spend is $3 million to buy 62 properties. And the total fair market value was 12.8 million. So when you do the math, it's 8.8 million in equity on a $3 million spend. And that's going to take about eight months to turn through that pipeline. 8 million in profit off a $3 million spend. Think about that.

Seth: I know with what you do, having a good attorney is an important thing, right? Are there ever situations where you don't need an attorney at all? You just do it all yourself?

Logan: I'll admit that I'm a little more unique when it comes to that. I was willing to spend the time and do the research and learn. And I was willing to make judgment calls. I think that was one of the skills that I have that sets me apart from others. But that doesn't mean that folks that are going to be successful in this business have to have that skill. If you round up a couple of real estate attorneys that are pretty good and get some advice along the way, they can solve 80% of your problems without you having the special skill that I've kind of realized I have. But you've got to get a good attorney, man.

Seth: What makes a good attorney? Let's talk about that for a minute because it's a key component. What is the trick to finding one? Like, what questions would you ask? What are the red flags and green flags to know you're dealing with an A player?

Logan: It's like dating, man. You got to go meet a bunch of them. You got to try to work with them. You got to get irritated with them and not use them anymore and then get lucky and one works and keep doing that. It's like dating. I've probably hired over 100 attorneys in my career. Today, I have five that I pay monthly. One of them works for me in-house full-time. The other four, I pay a little bit to this one, depending on what he bills me for that month. All those four have different specialties, just a little bit. One's a bankruptcy attorney. One's just a litigator. They're just different specialties. So depending on what my project load looks like, who's getting paid the most? But my monthly legal bill is like 50 grand.

You got to test and tune. You got to get referrals from other real estate investors who've worked with attorneys and liked them; go interview them. Just ask them all the normal questions you want to ask them. And you got to feel through it. And if your gut says you think it's right, then start working with them. And if you become dissatisfied because you're not getting the result, get rid of them and get another. It's just like dating. The moment it doesn't work, I'm ready to get married in my life. I'm dating to get married. Doesn't work. Get out, get a new one. Test it and find that one.

Seth: What are examples of red flags or stop signs? Like, nope, this isn't working. I'm out. Like if they don't respond at a certain time or is there a certain question you're asking and you want to hear a certain answer? Tell me what this conversation looks like.

Logan: One of the problems I find with attorneys, and even good ones, is that they come from big firms or they came from firms after school; they got their experience there. They're entrepreneurial and they want to go out and start their own firm. I think lawyers are like the most common big professionals that start their own firm. The problem is if they start their own firm and don't have an assistant and two paralegals for every one lawyer, forget about it. When you call the law firm and that lawyer answers the phone, don't work with them.

He's having to create invoices. He's having to service his clients. He's having to schedule. He's having to draft documents. He's having to go to hearings. And you know what that dude won't do? He won't call you back on time. He might answer that phone when it rings at the office to get new business. But once he's got your deposit and he's working on your project, you're the dude he ain't going to call back because he doesn't have the time.

Most of those attorneys are poor business owners. They could be brilliant attorneys, but they're horrible at managing a business. So you don't want to go with the small guy that's just onesies or twosies. You want to make sure that he's got an office that he rents. None of that's working from your house business. I want to see that he's got a front desk person all the time and he's got one or two paralegals and then he has a lawyer too. That's a minimum. If he doesn't have that, he can't be an efficient business owner.

Seth: I never thought about that. It sounds like you would prefer a good business owner over a brilliant lawyer. Am I hearing that right?

Logan: No, they need to be both. They need to be a great attorney and a good business owner. Maybe that's why they're hard to find because it's hard to find both.

Logan: Right. It is. And that's why you've got to date a lot. That's why you got to go through it. Now, what I'll tell you is that when your business starts to grow, it gets to the point where you just hire a big firm. Big firms are real expensive, man. They bill you for every seven-minute, eighth of an hour increments. And a partner might manage your file, but he's got three or four associates under him and paralegals under him. You ain't going to miss a beat on that bill, man. Your bill is going to be high.

But in the early days, you have to manage that. You really got to watch it because every dollar matters. Today, I got a budget for every file, a legal budget, and I'm going to work and I'm going to spend it. And when you're buying $300,000 property for 50 grand, who cares if I spend $20,000 on legal? It doesn't move the needle. My margin is still incredible. And the more I spend, the quicker I spend it on legal, the quicker I get the file done. So I'm of the opinion I only get the best attorney. So several of those attorneys that I work with now are the big, big, big firms. Most of my attorneys are $500 to $600 an hour.

Seth: So you do this in Texas and all your deals are in Texas. And it sounds like, maybe I'm misunderstanding this, but it sounds like having a physical presence near the deal is at least somewhat important. Say if you have to go in court or show up at your attorney's office, or I don't know what you have to do. But I'm just wondering, like, if I want to do this in Texas and I'm in Michigan, or if I'm in Texas, I want to do this in some other state. Like, am I in trouble? Do I need to make sure I'm at least within a three-hour drive of these properties? Or what do you think about that?

Logan: Let me offer you some insight on that. So I got a call from somebody the other day and said, "Oh my gosh, I was looking at the property records in North Carolina and saw one of your companies. I didn't know you're outside of Texas." Well, surprise, buddy.

Logan: So we are doing transactions outside of Texas. The majority of them are in Texas, but we have a lot of them outside of Texas because of JV and referral deals we do. But you don't need to be near the property. I'll tell you, if you look at my inventory right now, I've probably been to 10 properties of the 120. When you're buying property at less than its land value, you can't destroy the land. Man, I don't waste the time to go. I deploy a HomeJab or somebody like that to go take pictures and send me a report. I don't need to go, dude. I might send a realtor and a surveyor out there, but I'm not going.

Seth: So if a person does want to do this in another state, maybe one specific strategy; for example, I think of the landlocked properties that you've gotten easements to, which is a fairly feasible thing to do in Texas because the law is there, but those laws don't necessarily exist in other states. So it just makes me wonder, what are the first things you want to be looking at in those new states to make sure, okay, I can actually do this. I'm not barking up the wrong tree in this state.

Logan: I would be careful about New York and California. Their political environment is just not really good for property rights. Probably the most superior property rights state for the laws is Texas. So that's a very leading indicator. Landlord-friendly matters because we do a lot of evictions. When property is vacant for years, idiots show up and live there and they think they own it. You got to be able to get them out.

But probably one of the most important outside of property law states are affidavits of heirship states. So you can differentiate states when it comes to probate in two categories: a required probate or not required. And if it's not required, you can do an affidavit of heirship. So man, I work with people that do these deals across the United States, and I don't say, "Come to Texas, it's better," or "Come to this other state, it's better." Just make sure you can use an affidavit of heirships in that state in lieu of probate. And I prefer states that have higher property taxes because that is an initiative. That's a motivator for properties to be transacted if they don't get paid.

Logan: So I want to look for, is it an affidavit of heirship state, and do they have a lot of property taxes in that state? And if you have those two factors, man, play ball. You don't need to be there, dude. And court, think about it for a minute. I'm not going to court to testify. The attorneys are the ones going. You know, I might have to go for a Zoom deposition or something, but it's rare. I can't tell you, man, when the last time I had to go testify live, it's been over a year.

Seth: What do you think keeps most people out of this kind of business model? Is it, they kind of see the big numbers and like, wow, look at all these legal fees and lawsuits and all this stuff. Like, does it just feel overwhelming so they don't bother with it? Or do people just not know they could do this?

Logan: I think that's the key. People feel like it's harder than it is. And when we start working with people, man, I just explained, dude, it's not as hard as you think you're on the right team. And after we're done coaching you for four months, you're going to be freaking blown away at how simple a lot of this really is. And you really are going to wish you would have started it years ago. That's what they all say.

But it's not; it looks overwhelming, but man, everything's overwhelming if you don't have the right guide. Now, you can get on YouTube and go talk to Jerry Norton and Cody Sperber and they're all going to tell you how to wholesale. And it seems simple, but what I do isn't any more complicated than that. It's just that there's not a lot of information because I'm the only one that really talks about it, I think.

Seth: I'm wondering when you look back on all the deals you've done, the ones that were like the biggest pain and arguably not worth it. Like, is there anything that you wish you wouldn't have done? And if so, what went wrong? What could you look back on and say, "Oh, I should have caught that and not done it because of X, Y, Z?"

Logan: You know, I stopped doing projects that include improvements, meaning a building or a house where one of the owners lives in it and they don't want to sell. So there's a lot of property out there that is inherited and you've got multiple owners and everybody wants to sell, but one. One of the siblings will move in and they won't pay the taxes. They won't let the other siblings come in. They're like bad people, man. They're usually bad people. But even though this is a property rights state and you can win the lawsuit and get them thrown out and get the property sold, it's just not a good look, man. You don't want to be in your local newspaper for doing that. And it's just as easy to pick a house that's vacant as it is one that's occupied. There are tens of thousands of problem properties out there. So just don't pick the one that feels like that. So that's one. I stay away from those. I also look out for the minors. You can deal with minors, but you want to make sure that they have a small amount of equity.

Seth: Yeah, that's a big red flag there. So on that thing, the minors thing, and I remember you said that last time we talked about a year ago in this thing of like people living in the house that don't want to sell, whatever these like showstopping issues might be, how long does it take you to determine that? Like, I assume you probably get a property under contract. You probably do a title search. You probably send somebody to inspect it. How difficult is it for you to just make the determination of, like, yes, we're doing this or no, we're not because of these problems?

Logan: Every once in a while, you get a surprise later on after you're in there, you know, but usually these kinds of red flags come up. Think about it. I'm talking to four people that are owners or one person that's an owner and they're telling me, "Yeah, Johnny's a minor." Like we got a problem. "Our cousin's a minor and his mom died and he's 14 years old." Like you hear these things early on. Or another part is, a lot of family members say, "That knucklehead, my cousin Joe lives in the house and why I hate it is because he hasn't paid taxes. He won't even let us go." Like 90% of the time you hear this stuff up front. Now, the other 10% you'll figure it out along the way. You're like, "Well, crap. I wish I would have known this."

Seth: Yeah, totally. It's like half the land deals, have I... I'm just kidding.

Logan: So let me tell you this, though. The land deals that you do that you find out more later and wish it would have been different—if you were paying 20 cents on the dollar, 90% of your problems would go away and you would still like the deal. That's very true. Today, all this crap is worth it. If you pay little enough dollars for it, is the juice worth the squeeze, man?

Seth: On that whole question of, is the juice worth the squeeze? So the way I assume this works is you figure out what has to be done. You figure out what the thing is worth. You formulate your offer, you send it to them. You explain why. And what if they say, "No, I want more." How flexible are you willing to be? Or how much higher will you go before you're like, "Nope, I'm out."

Logan: Look, why I like being in a space where there's almost no competition is that I can be kind and I'm polite and I'm fair and I'm firm. I explain to people, "Look, y'all have been trying to sell this thing for 10 years. You had problems for five years. There's a boundary that I've got. And the same problems that you have had, you're going to turn those over to me. And it might be years till I get them solved just like you. So I don't want and can't overpay. Otherwise, I'm stuck. I'm in a bad spot."

So this is my price point. If you don't like this project and you don't like the pricing, I respect that it's yours. I suggest that you go pay the attorneys, straighten it out, and you make the big bucks because it sounds like that's what you want. And I completely respect that. I would never want to pressure you into doing a deal with me that you shouldn't be doing. And I walk away. But I do tell them, "I just want you to know that I am probably the first person that 100% can guarantee that they're going to do this deal and pay you. In fact, if you agree, I'll send you a contract, a deed and a closing package tomorrow. I'll buy it tomorrow. There's no contract period. There's no waiting. There's no option. I'll buy it. But for that certainty, my price goes down."

And what's interesting, man, is there ain't nobody coming behind me offering much different than this. And if they do, they usually can't fix the problem. So I let people know, "Hey, I'm here. I'll be here. You know, you're welcome to go try to find someone else to do this. And if they'll offer to pay you more, take it. See if it works. Probably won't. I'll still be here. I'm not going to negotiate."

Seth: It's really interesting hearing you say this stuff because it sounds like you're pretty good at the salesmanship side of this, like making a compelling case and helping them understand. It makes you wonder, how good of a salesman do you have to be? Because, like the truth is, you are the best offer they're going to get. It's just a matter of them understanding that and you being able to convey all that stuff. So is this something you've had to get better at? Or are you like naturally good at sales and negotiating that kind of thing?

Logan: I think the job is for you to communicate the reality. It's not them understanding. It's me communicating the reality in a way that makes sense to them. And the context is good. But I personally have never felt like I'm a good salesperson. I had sales jobs early on in my career and I didn't do well at that because, you know, you go listen to like the Andy Elliott's of the world. And man, it's so impressive to hear those skilled salesmen that were just born salesmen. That's not me. I always struggled with sales.

But what I love about this is that it's such an ultra rational and ultra logical situation that what I have to do is be fair and clear and do a great job of explaining what the reality is. And the neat thing is that reality is what's so special here, not my spin on it. So I'm here. I'm happy to do the deal. I'll do it with you now if you want. And if you don't, that's okay too. I'll be back later. Call me whatever you want to do. But there are tens of thousands of these and actually I have a lot of meetings today with people that have situations just like yours. So I'll just go to the next one.

Think about this. I always relate this to dating. Think about if you were in the dating pool and you're the last man on earth and there were 10 million women; how would you sell yourself then? Same here. Same thing here. 10,000 problem properties and one dude who can fix them.

Seth: Yeah, I think there's that. That's very important. But also, I think what's going on here is that when you're confident about something and you know your stuff, it's not really selling anything. Like you're just stating the facts as you know them to be. And you're not just puffing yourself up. Like you're just saying it as it is. People can sense that kind of confidence, I think. And especially when you're armed with as much experience and just market knowledge as you, I can totally see how it gets a lot easier.

Logan: Actually, that's a really interesting point. I'm thinking about the early days and I would really take my pride and ego out of this equation. So when I would talk to people, they would say, "How can you promise me you're going to fix these problems?" And I was honest. And I said, "I can't; I'm not a hundred percent sure. My lawyer says if I do this, I can fix that. And if I then do this, then this will happen. And I think that's what's going to happen. But that's part of the reason I can't pay you big money. I'm not very certain. So I'm going to try my best and I really hope it works. And it has worked in the past for me and I've made some money, but I'm not perfectly sure yours is going to work like that. So I have to be careful with my investment."

And what they could see—this is what matters—the honesty, the transparency, being humble and just being a fair person to talk to. That's what bled through. Now, 10 years later, my pitch is a little different because I do know that I'm going to take a run at it and I'm probably going to fix it. And if it doesn't work, that's okay. I can afford to sit on it. So the pitch is more confident, but it's the same humble delivery. And that is more important in my mind than the confidence or the lack of it. I had confidence in myself. I'm going to take a try. I'm going to run at this and I'm going to do the best I can. I really hope it works. I don't know if it will, but I'm willing to put my money where my mouth is, Mr. Seller.

Here is the cleaned-up transcript with the correct speaker labels:

Seth: Would you say that increase in confidence has changed things for the better? Do you close more deals as a result of that? Or did you do better back then when you were more just real and honest?

Logan: Well, the neat thing is I can still be real and honest. The difference is—

Seth: Yeah. I'm sorry. I worded that weird.

Logan: I'll tell people today, I know for a hundred percent, there's always a solution. That's in the judicial system in front of a judge. And it might be profitable at that time. It might not. I know this can be solved. And after 10 years of this and paying a million dollars in legal fees or whatever, I know this can be solved. I just don't always know what it looks like to get there. So I think we did. I did really well by myself. And today I've got 20 people in my office and five partners and we run a really, really cool place. And I mean, I think the confidence helps. I do.

Seth: We're talking about, you know, how you were 10 years ago when you started this. So if you were starting out again today, what's the one piece of advice you wish someone would have given you earlier on? Or what would you tell yourself 10 years ago? Knowing what you know now about this business?

Logan: I wish I would have found more resources quicker. And I didn't know to look. The good thing is for folks that are starting now, they don't have to go through what I did because you got like Carl Spie Vogel up in the Carolinas. You got his partner, Stass. You got McLean Bobbitt over there in Dallas. Like there's some people that are starting to do this and start doing pretty good. There's our operation. There are good resources out there. But I would tell people to buddy up with an attorney quick and don't be afraid to pay him. It ain't cheap. You got to pay him by the hour. But don't be scared of that spend because you're going to get smart quick.

That's where I got the smartest, the quickest. When I was working with the lawyers, I'd go to their office with a big old file and my checkbook and I'd tell them, turn on the clock. Let's start the meeting at one o'clock. And we had three hours that day and I'm paying them 300 bucks an hour at the time. So that's a thousand dollar meeting for me, but I got a problem here. The lawyer would go research it. This doesn't work. Try this. And I'm like, what about that? What we're literally brainstorming the whole time. And I walk away with 10, 10 plans of action when I leave that office. So I'd tell you, go find good lawyers, go pay them, and go ask a bunch of questions. That was probably the most important factor.

Seth: I got a few questions related to a video that you had posted in the REtipster Facebook group last March, which I thought was really interesting. I'll just give a quick recap of that. So you were talking about how to get a seller to perform if you sign a contract with them and they start flaking out. And this is especially a big deal for what you do, because in a lot of cases, you've spent a lot of time and some money solving some big problems for them. And all of a sudden, if they say, nope, I'm out, it's going to cost you a lot. And so you had talked about one way to resolve that is to file a memorandum of the pending purchase agreement and just make that a record and file a performance lawsuit against the seller. Am I recalling all this correctly? Does this sound familiar?

Logan: That's close. That's close. That's close.

Seth: Okay. What did I miss?

Logan: I don't like to file a memorandum of the contract. I like to file Liz Penance and that's a notice of litigation. I'm willing to fix their problems, work really hard for them and do all these things. And I'm going to get a low purchase price, but I do what I say I'm going to do. And if my contract says this, I'm going to do it. And if you don't do what you say you're going to do, I'm going to make you do what you said you're going to do. I live up to my word. You better live up to yours.

And if I start investing time and effort into this, I'm not going to let you walk away. This is a business and I'm fair, but I'm firm. So at this point, I don't know, I've probably filed a dozen or two specific performance lawsuits and I've won every single one of them. When a person starts to back out, I make sure that I up, I did all of the things under the contract that I'm supposed to do. I did them. I did them all the time and I know I have a good contract.

And if I do that, I know that I'm going to get that specific performance judgment.

Seth: It was a great video, by the way. You mentioned stuff that I hadn't even thought of about how like, you need to prove that you perform too. Like you need to show up at the title company on the closing day, like prove that you did your part because otherwise they can just say you didn't do your part. But I am curious, like you sue a seller for failing to perform. What happens next? Like, does the court force the sale? Is that what goes on? Or does the seller have to pay you something or what's the outcome you're looking for?

Logan: What you're looking for is to invoke a specific performance, and that is the specific performance of the closing of the contract. So I'm asking the judge to make this person close. So I'm not looking for damages. I am looking for reimbursement of my legal fees, which should happen out of the proceeds of the seller's sale once I pay them. But I'm looking for a performance. And it depends on the jurisdiction you're in and who your lawyer is and the judge and all that, but it can go a couple different ways.

Sometimes you can appoint a trustee or a receiver to administer the sale. Let's say the seller doesn't show up to the lawsuit, doesn't show up to court and you get a default judgment. You can't make the seller sign because he didn't show up. So you can appoint a receiver to sign on behalf of him and the money will go in the court registry. That's one way to do it. Now, sometimes you might have some other title issues that the seller has to come forward and sign off on. Or there might be some other performance things that the seller needs to be there, like to sign an affidavit of airship at the closing, things like that. And if they don't show up, the receiver can give you the deed, but you don't get the affidavit of airship, so you still don't have a clear title. So in that case, you ask the judge, you do a motion to show cause, and the judge issues an order that says, counterparty, come before me and show the reason you didn't come to court.

Prove to me the reason you didn't close and that it was good. And if they don't do that, the judge will issue a bench warrant. So they now have a warrant for this person's arrest and they'll be brought into the court and put in a cell and they sit in that cell until they answer the judge or close.

Seth: I know that sounds really radical. And I actually didn't know that was the end result until I got deep into one of these and the attorney. I thought the judge was going to give me the property. And at that point, our attorney said, “No, dude, that's not how it works.”

I didn't realize that's how it worked either, but that's fascinating. It makes me wonder in these situations where this could happen, which I guess is almost any situation, but I imagine it's probably more likely when there's a longer term on the closing date, like if it's six months out or 12 months out or whatever it is. But I guess the question I'm getting at is, when you see a property and you evaluate its problems, you understand what it's going to take to fix it. How long do you set that due diligence period or how long do you make it be before the thing has to close?

Logan: If I can get good information from the public records and the seller at the time, many times I'll send a contract, a closing package, and a deed to their house in a couple of days. And it all happens at once right there and I'll buy their share. Now there might be other outstanding shares I need to buy, or that might be all of it. I don't know. It depends on the situation, but many times I'll just buy it right then. Now there are also times where I need to get more information, where the seller doesn't have a lot, or I might need to request payoffs from creditors or tax jurisdictions or mortgages or whatever. In that case, I just stick a six-month contract in front of them. I usually don't want to do less than that because I don't want to be held over the barrel. You know, I'm three months into this deal. I got a 90-day contract. I've done a lot of work, but I have a few things. I don't want them to hold me over the barrel. So I'll get six months usually.

Seth: Gotcha. No, that helps. We're coming up on the end here. Appreciate everything you've shared here, Logan. It's been awesome. But so if people want to work with you or just find out more about you, follow what you're doing on it. You have an awesome Instagram account; all kinds of great stuff there. Where should they check you out?

Logan: Instagram is the best place. We work hard to get all the DMs answered as quickly as possible. We share a lot of information on there. We're really active on Instagram and Facebook. So those would be the two quick, easy ways.

Seth: Sounds good. I will link up to all that stuff in the show notes again, retipster.com forward slash 208. Any last thing you want to leave with us, Logan?

Logan: You know, I'd like to encourage people to put this out in front of them. Things are a lot easier than you think they're really going to be. The answer is out there. Trust in yourself, bet on you, and don't give up on that bet. You'd be surprised. You know, I went from working in the oil field, making all the right money, to today. You know, I pay more in taxes than three times what I earned back then. And I cut most of my taxes down by depreciation by buying new real estate.

I mean, you really are much more capable than you think. And if I had given up on some of these tricky things early on, you know, I don't know what life would have been like today. But, you know, I want people to remember that. And I want them to trust in themselves and bet on themselves. Go deep on that one, you know.

Seth: I saw a video a couple of weeks ago talking about how, for whatever reason, most of the best things or the most innovative, interesting things that most people do happen in their 20s. Like when you look at a lot of the best musicians and artists and actors and athletes and all these people, you look at them like the best thing they ever did. It was probably in their 20s or pretty close to that. And interestingly, that doesn't mean you're going to make the most money in your 20s. Like, the most important work they did was in their 20s. I think part of what's going on there is your brain is at a point where, like, it's more flexible. You're still in learning mode. Your knowledge hasn't crystallized yet, especially in this kind of business that you're in. The more flexible you can be is probably a huge asset because you'll see all kinds of weird problems. And if you're willing to open your mind and be like, "No, I'm going to find a way to fix that" instead of "Not tried that, can't do it." You just shut the door. How do you keep your mind open and flexible?

Logan: You know, that might be a characteristic that's inherent to me. When we look at something and say, "Wow, I got a person that's willing to sell me their share in this property for 5,000 and the property's worth 200,000." I'm very interested in figuring this out. And I'm so interested that it could be worth $190,000 to me. And that's what I want to make it work.

And, you know, we've got six partners here in this office. We brainstorm against each other all the time. So if you don't have somebody that you can do that with now, get into a little community of it because your IQ might be higher than mine or lower than mine. And mine might be higher than yours or lower than yours, but that's not what matters. Me coming up with an idea and bouncing it off of you, you have a completely different perspective. You have different experiences. Everything is different about the way your brain thinks. So we might both see the same situation in different ways and getting that feedback on these really tricky, almost riddle-like instances is so meaningful. In the early days, we built this model with us sitting around scratching our heads, troubleshooting. That's how this came to be. It wasn't my brain by myself. It was a bunch of guys figuring it out.

Seth: That's a really good point. I know some very smart people and their intelligence is almost like a curse. They kind of figured they're the smartest person in the room; they're not really that open to ideas or even looking for them. But man, like it kind of pays—as somebody with very average intelligence, it pays to have average intelligence. As long as you can acknowledge, like, I don't know it all. Like, I desperately need insight from other people to see the whole picture. Sounds like that's what you're doing.

Logan: Another key component of this, I find this with a lot of really successful entrepreneurs. They're willing to take a risk and step out there and take a run at it. And a lot of folks that are engineers or doctors or the kind of folks that worked well in that, they're concerned about every single little detail. And if there's any way something can go wrong, they don't want to do it until that's solved. And there are times where we just take a run at it. And we got a pretty good idea, but we're going to go and feel this thing out. And those personalities wouldn't do well here. I've watched it. But our personality is a little bit smart, a little bit stupid, a little bit bullheaded, willing to take a run at it. And that's where a lot of the opportunity does come from. We're willing to take a risk.

Seth: Yeah, that's awesome, man. Makes total sense to me.

Logan, again, thanks so much. It's a pleasure to have you here. I know I'm sure all the listeners are loving this. Probably learned a ton of stuff just like me, but I appreciate it. Wish all the best of what you're continuing to do. And again, I'll have links to all of Logan's stuff in the show notes, retipster.com/208. And we'll talk to you again next time.